On May 16, the U.S. Interior Department issued a favorable ruling regarding Lithium Americas Corp.’s (TSX: LAC) giant Thacker Pass lithium mining project in northern Nevada. The government agency found that nearly the entire Thacker Pass site contains lithium, a required condition to a February 2023 federal court ruling that affirmed the Interior Department’s decision to grant a mining license to Thacker Pass.
More specifically, the February 2023 decision by Chief Judge Miranda Du of the U.S. District Court of the District of Nevada that permitted construction to begin at Thacker Pass included a stipulation from a 2022 U.S. Ninth Circuit Court of Appeals decision. That court ruled that Hudbay Minerals’ proposed open pit Rosemont copper project in Arizona could not proceed.
The Court of Appeals decided in the Rosemont case that the U.S. Forest Service incorrectly assumed that Hudbay had valid mining claims to occupy about 2,800 acres of public land. Most of those acres would be used for waste rock facilities, and Hudbay did not establish that copper was present where the waste rock would be disposed. The Court of Appeals ruled that Hudbay could only use only utilize all 2,800 acres for the mine if it had established valuable minerals were present throughout the entire project area, including that which would underlay the waste rock facilities. The 1872 Mining Law was a governing principle in the court’s decision.
Judge Du of the U.S. District Court therefore required the Interior Department to investigate if lithium is present throughout the Thacker Pass site. A positive finding was necessary for her to “determine whether [Lithium Americas] possesses valid rights to the waste dump and mine tailings it intends to use for the Project.”
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Environmental groups have appealed Judge Du’s February 2023 decision to the Ninth Circuit Court of Appeals, the same court that issued the Rosemont copper ruling. Oral hearings on the appeal are scheduled to be held on June 26, 2023. It is of course unclear how the Ninth Circuit will rule on the appeal, but the Interior Department’s May 16 determination of a widespread lithium presence at Thacker Pass should factor heavily in the case.
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Separately, Lithium Americas reported its 1Q 2023 financial results on May 16. In its presentation, the company estimated that Phase 1 production at Thacker Pass could begin sometime in 2H 2026. In addition, lithium production at its 45%-owned Cauchari-Olaroz project in Argentina should commence in June 2023.
Lithium Americas Corp. last traded at $30.92 on the TSX Exchange.
Information for this briefing was found via Sedar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
